Stopping Mobile Fraudsters. What if the hunt for ways to stop theft in the mobile banking channel has been looking in all the wrong places? That tantalizing idea now is being floated by new-style fraud stoppers.

One reality: right now, mobile banking suffers much less criminal theft than does online banking. That is fact and, yes, it also has a lot to do with the 15-year head start criminals have in stealing from online banking channels. Mobile criminality will catch up, no doubt about it.

Reality two: study after study shows that the biggest barrier to mobile banking adoption by consumers is worry about security, privacy, criminality. A just released study via Infosys underlines this. The Infosys study said: “a quarter of [mobile banking users] say that a lack of confidence in the protection of their data is a top concern, and that number more than doubles to 60% among non-users. Moreover, nearly all consumers polled (96%) feel most comfortable or secure while banking on their home computer, edging out comfort levels even at the bank itself (93%t), on an ATM (84%), smartphone (83%), or work computer (only 52%).”

Additional findings of the Infosys survey show:

“Nearly half (45%) of consumers who do not use online banking believe that mobile banking is ‘experimental’ or ‘dangerous,’ and more than a third (38%) say it is ‘scary.’ In fact, non-users are three times as likely to say ‘scary,’ and almost four times as likely to say ‘dangerous’ than mobile banking users.”

Bottom line: to get more mobile banking users, credit unions have to get more persuasive about the security and reliability of the technology.

Enter Guardian Analytics which has now introduced a fraud detection toolkit – called FraudMAP Mobile – that leapfrogs device protection (“it’s not about end points,” said Terry Austin, Guardian Analytics’ CEO). This is an enormous shift in the security paradigm. Historically all eyes have been on the consumer’s device and what could be done to make it safer.

Per Austin, that is a fool’s errand. How can a financial institution protect a device it does not control? It can’t. Besides, devices are proliferating as are vulnerabilities and, Austin said in a Credit Union Times interview, the better way to stop criminality is to “look for anomalies in usage.”

Say it’s a mobile device that has never been used outside the U.S. and, suddenly, it requests a $10,000 transfer to an account in Kiev and even more interesting, the device is signing on from Russia, a country this user has never before been known to visit.

Probably that is a transaction that should be flagged for investigation. “We model what is typical for this device, with this user,” said Austin. “It is security that is independent from the device itself.”

What this invokes is robust computing power to do on the fly analysis – “We use statistical models to determine the trustworthiness of every event,” explained Austin.

That shift in focus away from the device and to studying usage – what’s right, what’s strange –

just may signal the start of a confidence-boosting conversation about how mobile banking security is getting realer.

And that is exactly what mobile banking needs to boost usage.

“We get very few false positives in our studies,” said Austin and that, too, is crucial because consumers will not embrace technology they perceive to be inconvenient and unreliable.

These ideas indeed are revolutionary but this shift in thinking just may herald a new, more effective way to safeguard the mobile banking channel. Watch: more players will enter into this arena because good computer screening ought to be able to outwit most criminals, be they pursuing mobile or online channels.

The Cool Factor. Call it going with what’s cool - that seems a probable explanation for a spike in consumer usage of credit cards enabled with contactless PayPass capabilities, according to Jonathan Orndorff, a MasterCardAdvisorsprincipal who recently headed up a look into how consumer behavior is different after they have a tap-and-go, contactless card in hand.

Tap and go is integral to PayPass but it also is built into Google’s Nexus smartphone and Isis, the joint effort involving mobile carriers and Visa and MasterCard.

But maybe a tap-and-go credit card is itself plenty for now.

Orndorff, in a Credit Union Times interview, ticked off two findings: “There was a noticeable increase in preference for a particular card when it has tap and go; and there was an average of almost 30% sustained lift in overall spend.”

Orndorff stressed that this study was based on analysis of spend data – with no consumer interviewing – but asked why a contactless card would deliver such a bump in usage, he hazarded this guess: “It may be perceived as cool or unique. And that perceived value is moving the contactless card to top of mind.”

His point: when the consumer reaches for that one card to pay this bill, he or she just may grab the cool one and if that’s the card that enables tap and pay, that’s the card he will use.

Countdown to the RDC showdown. The mobile remote deposit capture slugfest intensifies, as San Diego-based Mitek, holder of various key RDC patents, fights back against a suit filed by San Antonio-based financial services company USAA that alleges Mitek infringed on its patents. Mitek countersued, claiming it in fact owns the patents.

As with most patent fights, the issues immediately turn murky. The only certainty: the stock market is hammering Mitek shares, which have fallen by half in the past month. The bigger question: since this puts just about all the key RDC patents in a courtroom, will that impact market adoption?

Steve Ledford, a consultant with Novantas, predicted it won’t: Adoption is “consumer demand driven,” said Ledford who added: “I doubt [this litigation] would have much effect on the decision of a [financial institution] whether to deploy mobile RDC.”